The SFP was introduced by the European Union (EU) five years ago to replace production-linked subsidies but the payment is still based on the average support received by farmers over the three years from 2000 to 2002.
This is likely to continue until at least 2013 and is viewed as a nonsense by many farmers as it means that many recipients, including retired farmers and entrepreneurs who have speculated by buying SFP entitlements, continue to receive support, estimated at 4m a year.
However, the adoption of the historic basis of calculating eligibility for SFP has avoided the problems experienced in England where the move to an area based system has resulted in huge administrative problems and late payments.
The Scottish Government was congratulating itself last night on distributing most of the SFP due to Scottish farmers before Christmas. By the end of this week, 92 per cent of farmers will have received payment, considerably better than earlier forecast of 90 per cent by the end of the year and well ahead of the EU's mid-2011 deadline. It is expected that all outstanding payments will be completed by the end of January. Cabinet secretary for rural affairs Richard Lochhead said "significant" efforts had been made to process SFP as quickly as possible to get vital funds into farm bank accounts at a time when farmers were facing severe weather difficulties.
"Farmers across the country are having to deal with extraordinary and very difficult weather conditions so it was important to get the SFP processed and paid as quickly as possible at a time when the costs of feedstuffs and other running costs are high," said Lochhead.
Responding to a plea from NFU Scotland, reported in The Scotsman yesterday, for early payment of less favoured area support scheme (LFASS) payments to hill and upland farmers, due to be released on 1 January, Lochhead last night gave an assurance that every effort would be made to pay LFASS on time.
Farmers have also welcomed the decision of the Department of Transport to relax lorry drivers' hours to allow feed deliveries to farms and uplift pigs for slaughter. It has also been confirmed that the temporary emergency relaxations of hours for drivers involved in the distribution of fuel oil, liquid natural gas and petroleum related products will be extended to 10 January.
Lack of fuel and heating oil deliveries has been causing great concern to farmers, according to NFUS chief executive James Withers, although new deliveries have now been made to the main distribution depots.
The union is encouraging farmers to arrange collection points if suppliers' lorries are unable to get up farms roads.